Tax Policy

Tax Cooperation Policy Brief 4, September 2018

Exchange of Information: Indian Experience, Developing Country Implications

Exchange of tax-related information between countries is a critical tool for addressing information asymmetries between governments and taxpayers that facilitate tax evasion/avoidance. However, the existing system of information exchange has been essentially designed and implemented by the OECD, without the participation of developing countries. This policy brief thus discusses India’s experience with implementing information exchange for tax and other purposes, with lessons being drawn for other developing countries grappling with base erosion and profit shifting.

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Tax Cooperation Policy Brief 3, August 2018

Interaction of Transfer Pricing & Profit Attribution: Conceptual and Policy Issues for Developing Countries

Till 2010, model tax conventions treated profit attribution to permanent  establishments  and transfer  pricing under  different  articles,  and  profit  attribution under Article  7  allowed sales to be taken into account both in the direct accounting method as well as the indirect apportionment  method.  However,  the  revised  Article  7  in  the  2010 update of the OECD Convention approximated profit  attribution  with  transfer  pricing  and  omitted  the option  of  apportionment,  thereby  undermining  sales  and contributions   made   by   market   jurisdiction   to   business profits. When a tax treaty retains Article 7 based on the UN Convention  or  the  earlier  OECD  Convention,  Contracting States  can  take  sales  into  account  and  also  opt  for  apportionment.  Developing  countries  need  to  fully  understand these implications of  Article  7 in their tax treaties, and opt for informed choices for transfer pricing and profit attribution  to  permanent  establishments,  including  apportionment that takes sales into account.

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Policy Brief 48, June 2018

Collaboration or Co-optation? A review of the Platform for Collaboration on Tax

The Platform for Collaboration on Tax (PCT), launched in April 2016, is an effort to intensify cooperation on tax issues among the staff of the OECD, IMF, World Bank and the United Nations.  The PCT’s stated objectives include the production of joint outputs, strengthening interactions between standard setting, capacity building and technical assistance and sharing information. PCT has since produced toolkits on issues such as tax incentives, transfer pricing, and taxation of offshore indirect transfers. The PCT also held its first global conference in February 2018 at the UN where a concluding ‘conference statement’, negotiated among the four secretariats, was produced.

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Tax Cooperation Policy Brief 2, May 2018

Transfer Pricing: Concepts and Practices of the ‘Sixth Method’ in Transfer Pricing

Many developing countries are particularly concerned with problems of transfer pricing in the extractive industries, which are often significant components of their economies. Similar to other sectors, profit attribution may be highly dependent on the valuation of commodity exports. For this reason, a number of developing countries have adopted the ‘Sixth Method’, following the Argentine experience. This method aims to establish a clear and easily administered benchmark and avoid the need for subjective judgment and discretion.

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Tax Cooperation Policy Brief 1, May 2018

Ecuador and Its Fight Against Tax Havens

Taxation has been a key tool in improving Ecuador’s Gini coefficient. Ecuador has improved how it manages tax collection and implemented domestic anti-fraud regulations and international mechanisms concerning aspects such as transfer pricing and tax havens. These measures have helped to increase the tax base, which has had a positive impact on the redistribution of wealth and equality. The increase in the tax base has also led to more social investments in health care, education, the road infrastructure, etc.

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Statement, November 2017

South Centre Statement for the UNCTAD Intergovernmental Group of Experts on Financing for Development

Below is the statement by the South Centre during the first session of the UNCTAD Intergovernmental Group of Experts on Financing for Development (IGE Ffd) held in Geneva on 8-10 November 2017.

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IHEID Public Lecture, 24 October 2017

Title:                From tax havens to tax justice: Towards a fair global taxation system

Date:                 Tuesday, 24 October 2017, 18:30-19:30

Venue:             Auditorium Ivan Pictet, Maison de la Paix, The Graduate Institute, Geneva

Organizers:   The Graduate Institute, Geneva, The Permanent Mission of Ecuador to the WTO, Club Diplomatique de Genève, The South Centre

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